Title: A tale of three numbers

Author: N/A

11/8/96

FOR THE PAST TWO YEARS, the Republican Party has conducted
a remarkably successful PR campaign concerning its proposals for
the Medicare program. Republicans have argued that "there
are no cuts" in their six-year Medicare plan, and that President
Clinton is deceiving the public when he talks about Medicare "cuts."

Again and again, citizens have been told that, under the GOP
plan, "Medicare will continue to grow." And Clinton
has been routinely been denounced as a liar for his reference
to GOP "cuts."

The election is over and the time is coming when the two parties
will have to deal with Medicare. And the time has come for Republicans
to speak more honestly about both parties' Medicare proposalsand
for the mainstream press to report with more clarity about the
apparent future of the Medicare program.

For the record, I do not speak as an automatic antagonist to
the general outlines of the GOP plan. I think the level of spending
proposed by the GOP is within the range of what seems to be reasonable.

But the GOP's insistence that "there are no cuts"
has misled the public about its proposal. And the GOP has bullied
and browbeaten the national press into reporting this issue the
way the GOP likes it, producing an endless stream of misleading
reporting about proposed adjustments to Medicare.

The time has come to sharpen the discourse about both parties'
Medicare plans. And when we do that, the facts are clear: at present,
both parties propose spending substantially less in future years
than it would cost to maintain the current program. And the spending
levels the GOP has proposed will almost surely produce a reduction
in Medicare servicesdespite the drone-like assertions of the
national press corps that "Medicare will continue to grow."

THE FACTS: IN ITS 1995 BUDGET PROPOSAL, the GOP proposed spending
$6700 per Medicare recipient in the year 2002. At the time, the
Republican-supervised Congressional Budget Office was estimating
it would cost around $8000 per recipient to keep running the current
Medicare program in that year.

Hence, the GOP proposed spending $6700 per person in a program
it would cost $8000 just to maintain. Throughout 1995, this was
a proposal Speaker Gingrich described as a "40% increase
in Medicare."

Gingrich sustained this comic distortion by presenting only
two parts of a three-number story. Throughout 1995, Gingrich compared
then-current spending in the Medicare program ($4800 per recipient)
to proposed spending for the year 2002 ($6700). This comparison
was used to create the impression of a massive "increase
in the Medicare program."

Never mentioned was the ongoing CBO estimate of what the program
would cost by 2002. Needless to say, the GOP's $6700 proposal
takes on a vastly changed aspect when compared to the $8000 CBO
estimate. Inexcusably, it is a comparison the press corps has
virtually never made in the course of the past two years.

Current numbers: at the end of the 104th Congress, the GOP
was proposing to spend $7100 per Medicare recipient in the year
2002. The current CBO estimate? It will take $8090 per recipient
to run the current program in that year. There is virtually no
likelihood that, at the GOP spending level, Medicare "will
continue to grow."

In fairness, the GOP has proposed reforms for the program that
are intended to make it more cost-effective. It is at least conceivable
(though far from obvious) that the GOP could provide something
resembling current Medicare services for $7100 in 2002.

But I know of no reason to thinkas the press has insistedthat,
under GOP proposals, "Medicare will continue to grow."
In a rational universe, we are now searching for ways to maintain
current levels of service. We are certainly not looking
forward to the "40% increase in the Medicare program"
that Gingrich's slippery presentation has seemed to forecast.

IT IS INDEED IRONIC THAT THE MAINSTREAM PRESS has fallen in
line for the Speaker's presentation. For the press corps' drumbeat
assertionthat "no one is cutting the Medicare program"contradicts
reporting the press corps has presented over the past twenty years.

During that period, the mainstream press has repeatedly published
a standard sort of "good government" story concerning
the future of entitlement programs. In these stories, budget analysts
have argued that our entitlement programs will not prove sustainablethat
substantial changes will have to be made in these programs when
the baby boomers start retiring.

With the budget proposals made in the 104th Congress, these
predictions are now being acted out. But, over the past two years,
the mainstream press has taken its lead from absurdly misleading
GOP spin, dogmatically asserting again and again that "Medicare
will continue to grow."

The level of spending the GOP has proposed may turn out to
be all we can really afford. But the public deserves to be given
all three parts of the three-number Medicare story.

Table: A tale of three numbers (current data)

Per recipient Medicare spending, 1996: $5300

GOP proposed spending, 2002: $7100

CBO's projected cost of the current program in 2002: $8090

The press corps has routinely reported lines 1 and 2, and omitted
line 3 from
its stories.